Trump's executive order targets mortgage insurance, refinance costs. What it means for borrowers

Key points

• President Donald Trump signed an executive order titled "Decreasing Housing Costs for the American People" aimed at lowering mortgage costs.
• The order directs the FHFA to create a pilot program that proactively cancels mortgage insurance for eligible borrowers once their home equity reaches a certain threshold.
• The order also makes permanent an FHFA pilot program that waives lender's title insurance and allows cost-friendly alternatives to reduce refinancing costs.

President Donald Trump has signed an executive order aimed at reducing mortgage costs as rising interest rates and inflation make homeownership less affordable. The order, titled "Decreasing Housing Costs for the American People," directs federal agencies to proactively cancel mortgage insurance on eligible future loans and expand a program to make refinancing cheaper, among other actions.

The order comes less than two weeks before the Nov. 3 midterm elections, with rising costs and housing affordability a major concern among voters. It builds on previous orders to restrict Wall Street firms from buying single-family homes.

What the order changes

Trump's order directs the FHFA to create a pilot program that cancels eligible borrowers' mortgage insurance "proactively" once their home equity reaches a certain threshold, according to the White House. This would apply to mortgages originated after the pilot program launches.

The order also aims to reduce refinancing costs by making permanent the FHFA's pilot program that waives the lender's title insurance policy and allows "cost-friendly alternatives," according to the White House. Former FHFA director Sandra Thompson estimated consumers could save $500 to $1,500 in closing costs under the pilot.

millions of Americans will save thousands and thousands of dollars

— Bill Pulte

Uncertain consumer impact

It is difficult to know the future consumer impact without more details, according to Keith Gumbinger, vice president of mortgage website HSH. "I don't know that it's necessarily a game-changer in terms of the cost of housing, which is dictated by home price and mortgage rates at the moment," Gumbinger said. "But you know, every little bit certainly helps."

FHFA director Bill Pulte said in an X post on Thursday that "millions of Americans will save thousands and thousands of dollars." As of Oct. 23, mortgage interest rates for 30-year fixed-rate mortgages were 7.32%, according to Freddie Mac, and refinance demand was down 59% in mid-October compared with the same week the previous year.